what are the main reasons of the hike in oil prices? Suggest measure to stabilize the price of oil

The main factors which increase the price of oil products are falling dollar value, high level of demand for oil products, low level of supply and quotas introduced by OPEC.

Falling dollar value; most of the oil transactions were done through dollar. If the dollar value falls down, the domestic currency should reduce their value to cope up with this for the transaction of the oil products. The cost will increase with respect to the fall in the dollar price.

Increasing demand; the demand will increase with respect to seasonal swing. If the customers anticipate that the demand will increase in the future, then the price will increased.

Lower level of supply; this will occurred during unprecedented situations or events occurred in the producer country. Thus the traders will bid up the prices to make profit.

Quotas by OPEC; the reduction in output by the OPEC members will increase the price level. The supply dump by the producers will raise the price level.

The increasing level of the reserves will avoid the increasing or price hike in the market. The limitation of the cartel’s pricing policy will make a control over the price of the oil products. The proper policies by the OPEC aim to regulate the supply of oil and set the price over the world. The historic production cut will regulate and stabilize the oil prices.